All Forum Posts by: Evans Wright

 To not trip the due on sale clause, you would want to call the lending company that services the seller's loan and verify that there will be no issues with the deed being transferred into your entity. You can also seek out an attorney to help set you up with a land trust account and inform the mortgage company that you or a servicing company will be handling the affairs of the estate and paying it off. There are a few moving parts to making this type of deal happen but today's market will present many opportunities to capitalize on deals that involve creative financing such as subject to.

BP Team! I have a scenario that I believe subto can help be the solution but I have never done it before and would like your input.

Scenario:

Preface - This property is listed on the MLS and I am the buyers agent trying to come up with a way to creatively acquire the deal for my client. Listing agent is also an investor so they will get it.

Seller purchased property (Condo) back in April 22 for $300k, put $15k down, and about $15k in renovations to owner occupy. They ended up having to move for work so they want to sell but don't need to. Originally listed on MLS for $336k and is now at $332k with 27 days on market. They have got other offers but they have been low and seller thinks worse case they can rent it out but still doesn't want to if they can get an offer that allows them to feel like they won't lose too much money.

My thought is to submit an offer subject to at $325k, assuming the loan amount remaining is somewhere around $282-285k the buyer will cover the difference as down payment. 

I have not confirmed the interest rate yet but during that time period we were around 4.5-5% but when I speak to the listing agent about the idea I will confirm. Regardless, it will make more sense than current interest rates. I spoke to a closing attorney and they said they do about 70% of their business with subto deals and they told me to just download their subto offer form, fill it out, get it signed and they handle the rest.

I just need to know if there is anything else I am missing or need to be made aware of. I did advise the buyer about getting a lending servicing company to handle payments. Feedback is appreciated, thanks.

Good question Malachi! I am planning to leverage a HELOC to purchase an investment property but that has to be a property that I can add value to and and do a cash out refinance in a year or two to pay off the HELOC as quickly as possible. I think it is critically important to understand the end game and how the HELOC can support it. Unless it cashflows an insane amount to begin with then I would recommend you have a plan in place to pay off the HELOC asap so then you can use it again for another property and repeat the process. Hope that helps and best of luck on your journey.

 Thanks for that info @Michael Baum. Definitely not being that guy but also making sure I didn't misinterpret the info I was reading.

 Thanks for the feedback!

 You might be on to something here!

 It is not in my vocabulary LoL.

So maybe I am thinking way too much into this but I wanted to get the communities thoughts on what type of verbiage in the CCRs would constitute in Short Term Rentals not being allowed.

I am in North Carolina and many of the CCRs I see have lease restrictions ranging seven days to twelve months typically. That is all it will say in the CCR.

ex) Any lease of a unit or portion thereof shall be in writing and shall provide that the terms of the lease shall be subject in all respects  to the condominium documents...No unit may be leased for a period of shorter than 30 days.

I have seen others where it says no unit shall be used for hotel or transient purposes.  When I see that, it makes sense that they will not allow STRs but when I just see lease restrictions I am wondering if that automatically designates non Air BnB use.

I would love to get your thoughts especially if you have purchased a property for use as an STR in an HOA. It be great if I could some legal experts to chime in as well. Also if you see verbiage in the CCR like above stated as a best practice do you still contact the HOA management to confirm if STR are allowed or just rely on CCR?

Thanks.

 I live in Charlotte, NC and think there are many opportunities here especially considering we are having migration to the area and it is a very desirable place to be while still offering affordability.  That being said, I would still recommend you look at places in Miami or close to.  I don't want you to end up in a situation where you feel like you need to completely learn a new market to invest in because it "seems" more affordable and then delay investing for another year. 

The boost needs to come from within my friend.  No stranger is going to be able to convince you take the leap and spend hundreds of thousands of dollars. So how about I offer you an accountability partner? To make the final step you need to meet with a Realtor preferably one who invests in real estate themselves. Then you need to meet and get pre-approved by a lender if you plan to finance bonus points if they invest in RE as well.  If not skip that step.  Tell the realtor you want a multifamily property that meets your criteria which you have spent the last few years understanding what is important to you. Once you see one then just make an offer. I want you to engage with a realtor and lender (if required) by next Thursday.  I am going to add you and follow up on Thursday to see get an update.